On January $4,2014,$ Runyan Bakery paid $$324$ million for $10$ million shares of Lavery Labeling Company common stock. The investment represents a$30\%$ interest in the net assets of Lavery and gave Runyan the ability to exercise significant influence over Lavery's operations. Runyan chose the fair value option to account for this investment. Runyan received dividends of $$2\mathrm{.}00$ per share on December $15,2024,$ and Lavery reported net income of $$160$ million for the year ended December $31,2024.$ The market value of Lavery's common stock at December $31,2024$ was $$31$ per share. On the purchase date, the book value of Lavery's identifable net assets was $$800$ million and:

a$.$ the fair value of Lavery's depreciable assets, with average remaining useful life of six years, exceeded their book value by $$80$ million.

b$.$ The remainder of the excess of the cost of hte investment over book value of net assets purchased was attributable to goodwell.

$1.$ Prepare all appropriate journal entires related to the investment during $2024,$ assuming Runyan accounts for this investment under the fair value option, and accounts for Lavery investment in a manner similar to what it would use for securities for which there is not significant influence. Indicate the effect of these journal entires on $2024$ net income, and indicate the amount at which the investment is carried in the December $31,2024$ balance sheet.

$2.$ Prepare all appropriate journal entries related to the investment during $2024,$ assuming Runyan accounts for this investment under the fair value option, but uses equity method accounting to account for Lavery's income and dividends, and then records a fair value adjustment at the end of the year that allows it to comply with GAAP. Indicate the effect of these journal entries on $2024$ net income, and indicate the amount at which the investment is carried in the December $31,2024$ balance sheet.